PACER & PICTA

The Pacific Island Countries Trade Agreement (PICTA) is an FTA on trade in goods among 14 members of the Pacific Islands Forum. (Australia and New Zealand are excluded.) It was signed in 2001. Eleven countries — Cook Islands, Fiji, Kiribati, Nauru, Niue, Papua New Guinea, Samoa, Solomon Islands, Tonga, Tuvalu and Vanuatu — have so far ratified PICTA. As of 2008, it is being expanded to trade in services.

The Pacific Agreement on Closer Economic Relations or PACER is a framework agreement to deepen trade and investment liberalisation in the broader Pacific on a step by step basis. It was signed in 2001 and came into force in 2002. PACER includes Australia and New Zealand, who are excluded from PICTA and commits all members to begin negotiations towards a free trade agreement by 2011 at the latest. In August 2008, Simon Crean, Australia’s Trade Minister at the time, started advocating a "PACER-plus" agreement, in lieu of the originally envisaged FTA, which signals the aggressiveness of Australia’s stance to achieve an agreement, particularly given the EU’s pending EPA with the Pacific Island states. A number of officials and civil society critiques from the Pacific Islands have stated that the PACER deal is of little benefit to them, some pushing for greater labour mobility for Pacific Island workers to Australia and New Zealand. In June 2011, Fiji’s Attorney-General charged that PACER is only really benefitting the economically powerful in the region – Australia and New Zealand.

The PACER-Plus model of development is based on an increasingly questionable form of economics which naively imagines that national economies will adapt automatically to enhanced price signals from liberalised international markets from which ’distortions’ are removed.

There were promises that the agreement would be for the benefit of the Pacific. But it has been shaped more by the advantages to Australia and New Zealand exporters than the aspirations of the Pacific’s people.

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